"FCA's efforts to simply prohibit terminations of FCS institutions through a heavy-handed regulatory blockade of legal obstacles are completely contrary to the statute, legislative intent and good government," ICBA said in a comment letter.

"Instead of proposing streamlined regulations based on the statute's clear legal requirements, the FCA is simply catering to the system's long-term expansion plans as revealed by the system's Horizons Project. The FCA and the FCS desire to prevent FCS institutions from terminating their charters and then expand the lending powers of system institution charters in every conceivable area to become combination commercial banks and regional credit unions.

"The FCA and FCS strategy is based on crowding out private sector institutions by leveraging the tax and funding advantages of a GSE into markets already well served by the private sector. The result, if achieved, would ultimately be fewer financial institutions in rural America and fewer choices for rural citizens. This strategy cannot be in the best interests of rural America," observed ICBA.